Yes, you can take cash out of a credit card, but it costs more than a regular purchase
Most credit cards let you withdraw cash at an ATM or get cash back at a store checkout. The card issuer treats this as a cash advance — a short-term loan against your credit limit. Unlike a purchase, a cash advance starts charging interest when ready, has a separate (usually higher) interest rate, and often includes an upfront fee. You pay for the convenience of turning available credit into physical money.
The cost difference matters. If your card charges 18% APR on purchases but 24% APR on cash advances, plus a 3% fee, you lose money fast. A $500 cash advance can cost $15 to $50 just to take it out, then another $10 in interest within the first month if you do not pay it back when ready.
Key Takeaways
- Cash advances charge interest from day one with no grace period, unlike purchases which may have 21 to 25 days before interest starts.
- Most cards charge a cash advance fee of 3% to 5% of the amount withdrawn, on top of a higher interest rate.
- You can get cash at an ATM using your PIN, at a bank teller window, or as cash back at a store — each method has the same fees and interest rate.
- Paying back a cash advance takes priority over paying down purchases because the interest rate is higher, so your payment goes to the cash advance first.
How much it costs to take out cash
The cost of a cash advance has two parts: an upfront fee and a higher interest rate. The upfront fee is usually 3% to 5% of the amount you withdraw, with a minimum fee (often $5 to $10) even for small amounts. So a $100 withdrawal costs at least $5 to $10 just to take it out; a $500 withdrawal costs $15 to $25.
The interest rate on cash advances is typically 3 to 8 percentage points higher than your purchase APR. If your card charges 18% on purchases, the cash advance rate might be 24% or 26%. Interest starts accruing the day you withdraw the cash — there is no grace period like there is for purchases. A $500 cash advance at 24% APR costs about $10 in interest per month if you carry the balance.
Your card's terms sheet (called a Schumer Box, found on the issuer's website or in your welcome materials) lists both the cash advance fee and the cash advance APR. Check this before you withdraw, because the cost varies widely by card.
The three ways to get cash from your credit card
You have three options for withdrawing cash, and all three charge the same fee and interest rate. The difference is where you go and how fast you get the money.
ATM withdrawal: Use your credit card PIN at any ATM, including ones outside your bank's network. You get cash when ready. Out-of-network ATMs may charge an additional ATM operator fee (usually $2 to $3), which is separate from your card's cash advance fee. Your card issuer charges the cash advance fee; the ATM operator charges their own fee on top.
Bank teller: Walk into a branch of your card issuer's bank (or sometimes any bank) and ask for a cash advance. The teller processes it like a withdrawal from a checking account. This is slower than an ATM but avoids the out-of-network ATM fee if you use your own bank. You still pay the card's cash advance fee.
Cash back at checkout: When you make a purchase at a store, ask for cash back. The store gives you cash, and the total (purchase plus cash back) is charged to your card. Only the cash-back portion is treated as a cash advance and charged the fee and higher interest rate. The purchase portion is charged at your regular purchase APR. This is often the cheapest option because you avoid ATM fees.
Why cash advances are expensive compared to other borrowing
A cash advance is one of the most expensive ways to borrow money. Compare it to other options: a personal loan from a bank typically charges 6% to 36% APR depending on your credit, a payday loan charges 400% APR or more, and a home equity line of credit charges 7% to 12% APR. A credit card cash advance at 24% to 28% APR falls in the middle-to-high range.
The real cost comes from the combination of the upfront fee, the high interest rate, and the lack of a grace period. A $500 cash advance costs $15 to $25 upfront, then $10 per month in interest if you carry it. If you pay it back over three months, you pay roughly $30 to $35 in total interest and fees — about 6% to 7% of the amount borrowed. A personal loan for the same amount and term might cost 2% to 3% total.
Credit card companies charge this much because cash advances are riskier for them: you have already borrowed against your credit limit, and cash is harder to track than a purchase. They price the risk into the fee and rate.
How your payment is applied when you have both purchases and cash advances
If you carry a balance on your card with both purchases and a cash advance, your payment goes to the cash advance first. This is required by federal law (the CARD Act of 2009). Your card issuer must explore any payment above the minimum to the highest-rate debt first, which is almost always the cash advance.
This means if you owe $300 in purchases at 18% APR and $200 in a cash advance at 24% APR, and you pay $200, the entire $200 goes to the cash advance. The $300 in purchases keeps accruing interest at 18% until the cash advance is paid off. This is the opposite of what many people expect — they think their payment reduces the total balance evenly.
The practical effect: if you take a cash advance and do not pay it back when ready, you will pay interest on it for longer than you might expect, because your payments chip away at the cash advance first.
Alternatives to taking a cash advance
Before you use a cash advance, consider whether you actually need cash or whether you need money. If you need cash because you want to pay someone in person or withdraw from an ATM, a cash advance is your only option with a credit card. But if you need money for a bill or expense, other methods are cheaper.
Use a debit card or bank account: If you have a checking account, withdraw cash from your own bank's ATM for free, or use your debit card to pay directly. This costs nothing and avoids the cash advance fee and interest entirely.
Ask for a balance transfer: Some cards offer 0% APR balance transfer offers for 6 to 21 months. If you need to move money between accounts or consolidate debt, a balance transfer is cheaper than a cash advance. Balance transfers also charge a fee (usually 3% to 5%), but the 0% interest period makes up for it if you pay within the promotional window.
Take out a personal loan: If you need a larger amount and expect to carry the balance for several months, a personal loan from a bank, credit union, or online lender often has a lower APR than a credit card cash advance. The trade-off is that a loan takes a few days to fund, whereas a cash advance is when ready.
Borrow from a friend or family member: If the amount is small and you can pay it back quickly, borrowing from someone you know costs nothing and avoids the fee and interest entirely.
Frequently Asked Questions
Does a cash advance hurt my credit score?
A cash advance itself does not hurt your score, but it increases your credit utilization (the percentage of your credit limit you are using). If you borrow $500 on a $2,000 limit, your utilization jumps to 25%, which can lower your score by a few points. The impact is temporary and reverses when you pay the balance down. Late payments on the cash advance do hurt your score permanently.
Can I take a cash advance if my credit limit is full?
No. A cash advance counts against your credit limit just like a purchase does. If you have already used your full limit, you cannot take a cash advance. You would need to pay down your balance first or request a credit limit increase from your card issuer.
What happens if I do not pay back a cash advance?
The balance stays on your card and accrues interest at the cash advance rate (usually 24% to 28% APR). If you miss a payment, you may be charged a late fee and your interest rate may increase to the penalty APR (often 29% to 36%). The debt can be reported to credit bureaus and damage your credit score. After 180 days of non-payment, the card issuer may charge off the account and sell the debt to a collection agency.
Is there a limit to how much cash I can withdraw?
Yes. Your card issuer sets a cash advance limit, which is usually lower than your total credit limit — often 20% to 50% of your credit limit. So if your credit limit is $5,000, your cash advance limit might be $1,000 to $2,500. You can find your cash advance limit in your account online or by calling the card issuer's customer service number on the back of your card.
Can I use a credit card cash advance to pay off another credit card?
Technically yes, but it is expensive. You would pay the cash advance fee and interest rate on the amount you withdraw, then use that cash to pay the other card. A balance transfer is cheaper if your card offers one, because the fee is similar but the interest rate is often 0% for several months. If a balance transfer is not available, paying the first card directly from your bank account is free.